Obama

 Just before noon today, President Barack Obama proposed five new middle class benefits that will be detailed in his budget next Monday:

So why would a sitting president appear on a comedy show as President Obama did last night when he appeared on The Tonight Show with Jay Leno?  Why not just do a bunch of formal news interviews?

This is easy.

Continuing the series, how should a $500 billion spending plan be structured?

If I had my druthers, the word "stimulus" would be expunged from public discussion, along with "bailout" and "rescue."  These words convey the idea that, because we have so mismanaged our economic and financial affairs, we are somehow able or entitled to conjure up additional funds out of thin air to fix our problems.  There are two problems with this idea. 

First, the purpose of government spending is to purchase goods and services that the government needs to meet its responsibilities, not to hand out resources to those who pandhandle most loudly for them.  The reason to spend more in a recession is not to employ idle resources -- it is to be able to stretch the taxpayers' money further by getting a better price for its purchases because workers without jobs will work for less and owners of empty factories will charge less. 

Continuing a series that began last week with health care reform, I suggest that another high priority for the Obama Administration is what is known as the Green Tax Swap -- an increase in the gas tax combined with a reduction in the payroll tax rate that fully offsets the revenue increase.  (By gas, I mean all fossil fuels used for any purpose, but others might restrict what is taxed only to gasoline.)  What is the rationale for this?

I read with some interest this piece by Jeff Sachs in Slate, "What Obama Needs To Do."  I think there will be a lot of columns like this, so let me add to their number.  The thrust of Sachs' advice is this:

In sum, the recipes since 1981 of small government and small-bore solutions are passé and dangerous for our very survival in the United States and on this planet. While Reagan was crudely ideological, Clinton mildly reformist, and Bush simply crude in the application of these small-government doctrines, none of the recent approaches will do. It's time to stop talking about who can give away more to the public in rebates and start talking about investing in our future in a way that can save the poor, sustain the rest, and build a decent world for our children. Those are the real family values.

That was quite a speech former Fed Chair Paul Volcker gave to the Economic Club of New York yesterday. He recalled his stand against bailing out New York City and the beneficial long-run effects that resulted. Then he contrasted that with recent Fed actions under Ben Bernanke.